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Humanizing Tech

The Base Code Featured in Fortune Predicting Ethereum’s Explosive Price

Fountainhead News: Mar 17, 2017

Note: we’re opening up the Fountainhead News today to all subscribers of Humanizing Tech because Happy St Patrick’s day. In today’s episode, a little green goes a long way.

We started The Base Code as our own open-source personal hedge fund so anyone with an extra $50 or more per paycheck could participate in the strategies, and returns, employed by the big boy Hedge Funds.

And because you have less capital, it means it’s easier to make a return, and make a trade without moving the market.

You might have missed it a week ago, but The Base Code was featured in Fortune.

In it we described to Jen, the reporter, our go forward investing strategy that we had not yet written about in the pages of Humanizing Tech. I’ll repeat it here for perpetuity.

Or consider the strategy of Sean Everett, an entrepreneur specializing in artificial intelligence who recently launched a very small hedge fund called the Base Code fund. Last week, Everett sold all of his stocks in the fund as well as in his personal accounts, including Apple (AAPL, +0.16%), Nvidia (NVDA, +1.33%) and Amazon (AMZN, +0.05%) stock.
Instead, Everett says he will invest a third of his assets directly in Bitcoin, a third in Ethereum (another type of cryptocurrency that is cheaper than Bitcoin but has surged even more recently), and keep the rest in cash. “ Now that gold is the same price as bitcoin, we believe that an investor will have a choice between the two and might end up choosing things like crypto during the next market downturn,” Everett says.

Since that time, Ethereum’s price has jumped over 3x, from around $18 to it’s peak of $56 last night. It’s about $47 as of the time of this writing.

The question you might be asking yourself is why? My gut says it has a little something to do with the Fed raising interest rates and people, again, getting more exposure to this alternative investment class.

The thing that we like about Ethereum is that it’s first and foremost not controlled by a central government or authority (i.e., decentralized) as much as possible, and that you’re actually investing in a startup. Much like the Apple App Store, the more developers who build on top of Ethereum, the more valuable it becomes. Even JP Morgan Chase is doing it.

Time will tell, of course, but we are bullish.

But from an investor standpoint, it means you might start seeing hockey stick style returns from the “stock market” because you can invest in a startup with its value tied to its ecosystem moment by moment. That also operates as a currency to pay for things.

Bonus.

Another question might be how you can arbitrage prices so you remove the so-called riskiness of this new asset class.

A fun little open-source library was talked about briefly yesterday on Hacker News. It’s called Blackbird and it’s an open-source code base that arbitrages the price inefficiences in Bitcoin between one exchange and another. It’s already up to 700 stars and 14 contributors with upwards of over 200 commits.

It’s another way to make money in the short term from cryptocurrency. But you’re not getting into the world of algorithmic trading, where speed matters more than knowledge. That’s something Biologic Intelligence is great at. Lots of different types of data input, make sense of it in real-time, and push a trade out the other side.

Low Latency + New Biologic Algo = Alpha.

Sean


The Base Code Featured in Fortune Predicting Ethereum’s Explosive Price was originally published in Humanizing Tech on Medium, where people are continuing the conversation by highlighting and responding to this story.



from Stories by Sean Everett on Medium http://ift.tt/2mXlDnl